Types of common R&D partners and knowledge leakage to rivals: The role of IP litigation reputation

We argue that knowledge leakage may occur between rival firms through indirect ties, i.e., if rivals collaborate on R&D with a common partner, but that firms with an aggressive reputation for IP litigation may be able to restrict such knowledge spillovers. We argue that knowledge leakage is more prominent, and litigation reputation is less powerful, when the common partner is a university or public research institution adhering to the open science paradigm, compared with when the common partner is another (non-rival) firm. Patent similarity analysis among dyads of leading pharmaceutical firms provides support for these hypotheses.